Protection of copyrighted and other protected digitally stored data has always been a primary concern of the owners of such material. In particular, piracy of computer software, music and video has been and continues to be of great concern because it is all but impossible to stop. Although there have been many prior attempts by the software, music, and video industries to curtail piracy, each has been met with limited success.
As part of the effort to combat piracy, software vendors have licensed software 5 rather than transferring ownership when purchased. When software is purchased, the purchaser becomes a licensed user (i.e., licensee) rather than an owner. Copying of software under most license agreements is generally limited to one copy for backup purposes only in order to legally restrict unlimited copying. In addition, the software license typically grants a right to use the software on a single computer or for use by only one user at any time.
Software vendors have also attempted to combat software piracy by copy-protecting their software. While this attempt was effective to some extent, it failed because users were unable to make backup copies. Also, soon after the first copy-protected computer software was on the market, other programs to copy the copy-protected software became available. Other copyright protection methods were then developed in an attempt to stop piracy, also with limited success. These attempts included requiring a master floppy disk to be inserted into the computer or requiring the user to enter a key or other information contained in the user manual or license agreement when executing the software from the computer's hard drive. Still others required a hardware key to be present in the computer's parallel port, which was read when the software was executed. Software vendors received a temporary reprieve when CD-ROMs became the standard media for digital storage and distribution of software, because applications grew to be so large that the only means for copying the software was to “burn” duplicates on expensive recordable CDS. However, the prices of recordable CDS and the drives to write recordable CDS have fallen dramatically and pirates can once again produce cheap illegal copies of protected software.
The music and video industries have a different concern than the software vendors. These industries are particularly concerned with pirates making perfect copies of digitally stored music and videos. While copying of music and video for non-commercial purposes is allowed, such copying has historically been performed by tape decks and video cassette recorders using analog recording techniques. Analog reproduction results in decreasing quality with every generation, whereas digital copies are exact and suffer no fidelity loss. As noted, prices of recordable CDS and the drives to write to recordable CDS have fallen dramatically and these drives can just as easily record music to the CDS as they record software and data. Further, with the advent of the Digital Versatile Disk (DVD), full length motion pictures may now be recorded to a single DVD disk. As a result, the music and 5 video industries also have a growing need to prevent copying of digitally recorded works.
Fueling the concern of software vendors and the music and video industries is the rapid growth of the digital age and global communications. In the early 1980's when the personal computer (PC) was in its infancy and software vendors first attempted to protect their intellectual property, there were few, if any, mass distribution channels. At the same time period, the music and video industries were strictly analog at the consumer level. Thus, piracy was not a major factor as it was limited to small groups of people or organizations. However, with powerful computers on every desktop and the evolution of music and video into a digital format, piracy has become a major factor costing software vendors alone $4 billion a year worldwide. Clearly, the financial loss to software developers, musicians, actors, and their associated industries is immense.
At the root of the global communications expansion is the rapid growth of the Internet, which has pushed the piracy problem to the forefront. As is well known in the art, the term “Internet” was first used in 1982 to refer to the enormous collection of inter-connected networks that use Transmission Control Protocol/Internet Protocol (TCP/IP) protocols. Despite only gaining mass recognition over the past four years, the Internet has existed since the late 1960's and was originally designed as a Wide Area Network (WAN) that would survive a nuclear war. Throughout the 1970's and 1980's a growing number of small networks developed and connected to the Internet via gateways as a means of exchanging electronic mail. In the mid 1980's there was a significant growth in the number of available Internet hosts, and since the late 1980's, the growth of the Internet has been exponential. The growth of the Internet has provided people all over the world with a means to share and distribute information. Thus, the potential now exists for the mass distribution of pirated software, music and video on a global scale. Many Internet Usenet groups and channels on the Internet Relay Chat (IRC) are dedicated to the trading of pirated files, music and videos. Furthering the piracy problem are groups that maintain a high profile and take a great deal of pride in their piracy accomplishments. The piracy problem has grown so large that a new term, “warez,” is used to describe the pirated materials. The Internet now provides a great potential for legitimate sales and distribution of protected software, music and videos, because of its size, speed and penetration into the homes of consumers. However, these very advantages make it easy for pirates to steal expensive, proprietary software that took years to design and manufacture and within hours make it available to anyone, free for the taking.
In view of the above, there is a need for a secure method and apparatus for electronic distribution of data which will take advantage of the wide distribution of networks such as the Internet, while simultaneously preventing unauthorized and illegal copies of protected works, data and applications. In particular, there is a need for a method and apparatus which will provide vendors of software, music and videos with a secure means of electronically distributing their works and applications over the large networks, while ensuring that their protected works and applications are not copied and pirated. Such a method and apparatus would also ensure that the rights of owners of intellectual property are protected and that owners are properly compensated for their creative efforts.